Guest Post: Another Purchasing Cartel on the European Commission’s Radar – Lessons for Compliance

The following is a guest post from Oliver H. Geiss, a partner in our Brussels and Frankfurt offices, and Tatiana Siakka, an associate in our London and Brussels offices. Oliver focuses his practice on competition law in the European Union and Germany, and Tatiana is a competition law specialist with wide-ranging experience in both contentious and non-contentious matters.

For a long time purchasing cartels have been a relatively rare phenomenon in competition law enforcement. As a result, they may have received little attention from companies implementing compliance training programs. In the past couple of years, however, the Commission has become increasingly active in investigating and fining such cartels, notably in the battery recycling and ethylene purchasing sectors.

This month the European Commission announced another investigation into a suspected purchasing cartel. The authority confirmed that it has carried out a series of dawn raids at the premises of companies that purchase styrene monomer – a chemical used as a base material for a number of chemical products.

The Commission’s latest investigation is a reminder that colluding to fix purchasing prices is just as unlawful as conspiring to fix sales prices. It also highlights that purchasing and procurement teams – often overlooked when it comes to compliance training – are equally exposed to antitrust risk as sales teams.

It is therefore of paramount importance for companies to ensure that their purchasing employees receive adequate competition law training in order to be able to identify the relevant antitrust risks and act in compliance with EU rules on restrictive business practices. The three companies involved in the battery recycling purchasing cartel were fined a total of €68 million (currently under appeal), highlighting what is potentially at stake for failing to do so.

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Global Supply Chain Law – Supply chain legal issues have become increasingly prominent as supply chains become longer, leaner, and more international. Our blog discusses legal issues that arise in the supply chain, both those that cut across industries and those that are industry specific. We focus specifically on the legal issues that most often lead to litigation in the supply chain – a result that no one wants! We discuss current cases, important nuances in the law that can affect supply chain relationships, and ways to make supply chain legal practices more robust, particularly in light of today’s global supply chains.